Once Upon a Time in America

Economist Mark Thoma has put up a quote from Franklin Delano Roosevelt's political campaign for reelection:

July 08, 2011

"Instead of Twirling Our Thumbs We Have Rolled Up Our Sleeves"

Mark Thoma sends us to Ronald Dworkin quoting FDR:

How FDR Did It: For nearly four years you have had an Administration which instead of twirling its thumbs has rolled up its sleeves. We will keep our sleeves rolled up. We had to struggle with the old enemies of peace—business and financial monopoly, speculation, reckless banking, class antagonism, sectionalism, war profiteering. They had begun to consider the Government of the United States as a mere appendage to their own affairs. We know now that Government by organized money is just as dangerous as Government by organized mob. Never before in all our history have these forces been so united against one candidate as they stand today. They are unanimous in their hate for me—and I welcome their hatred. I should like to have it said of my first Administration that in it the forces of selfishness and of lust for power met their match. I should like to have it said of my second Administration that in it these forces met their master.

Posted on July 08, 2011 at 10:19 AM in Economics, Economics: Macro, History, Obama Administration

A personal note: one day just before my eighth birthday in April 1945, my mother showed me the headline of a newspaper. "I want you to remember," she said, "that a great man died today." That great man was FDR. We were living in Greenwood, Mississippi.

Never before or since did she speak to me about another political figure.

Financial Regulation: Who and How?

One of the biggest challenges in government at every level is how to regulate complex economic and industrial institutions without putting the fox in charge of the hen house.

The answer, as it has been since the time of the Greek philosophers, is to have people in charge who combine knowledge and ability with integrity. The ideal of the "philosopher king."

More easily said than done.

You may not think of the Federal Deposit Insurance Corporation (FDIC) as a likely place to find a philosopher-king. Think again.

Joe Nocera, a financial reporter and op-ed writer for the New York Times has just published an exit interview with Sheila Bair, who just completed her five-year term as head of FDIC. His article is well worth reading.

The comments by readers are also worth reading.

The article answers a lot of questions about how we got where we are with the economy and who might have been able to keep things from being as bad as they are.

Read My Lips: No New Jobs!

Today's employment report from the Bureau of Labor Statistics was dismal. Unemployment rate increased to 9.2%. Percentage of population employed is down. Wages are down.

The creditor class, especially the 1% at the top who own 50% of the nation's financial assets are delighted.

I wish I could say the news is surprising. It isn't. Nothing new here.

I have some more dismal predictions:
1. If the deficit hawks in Washington succeed in reducing government spending, the economy will contract further;
2. Wages will either remain stable or decline further;
3. Unemployment will increase and there will be a further decline in employed persons as a percentage of the population;
4. Our present position as 23rd in the world in terms of quality of infrastructure will decline.

There will be more bad news.

Because we will spend no more to stimulate the economy, our debt will actually increase.

No light at the end of the tunnel.

Oriental Town Charter 1899 - Road Work

At last Tuesday's meeting of Oriental's Town Board, at least two of the commissioners seemed to believe that the 1899 Charter governs, no matter what subsequent changes have been made to North Carolina laws.

Just to remind readers, the charter states that the town "shall be subject to all the provisions contained in chapter sixty-two of the Code of North Carolina...." So what does that mean?

The charter itself requires all of the town's officers to be qualified voters in the town. It requires that elections be held annually on the first Monday in May. It provides that commissioners have the right to collect taxes by levy and sale of property.

Under the charter, the mayor "shall have the power to cause all persons failing to pay fines, or who shall be imprisoned for violation of any town ordinances, to work it out on the streets...."

Under chapter sixty-two of The Code, the criminal jurisdiction of the mayor is the same as that of justices of the peace. Penalties for violating an ordinance were up to fifty dollars or up to thirty days in jail.

Anybody out there think the mayor still has that authority because of our 1899 charter?

Oriental Town Board Closed Sessions

Last night the Town of Oriental Board of Commissioners went into closed session "to discuss personnel matters" and someone mumbled the paragraph "143-318.11 (a)(6)" as the alleged authority.

Not good enough, on two counts:

(1): The open meetings act requires the public body to act only on a motion that explains the purpose of the closed session in plain English. Western Carolina University has helpfully provided a model motion for closed sessions under North Carolina Law here. Under section 143-318.11, there is NO general permitted purpose called "personnel." As you can see from the model, the public body must provide more information concerning the purpose under 143-318.11 (a)(6), selecting one of the following:

"+ consider the qualifications, competence, performance, condition of appointment of a public officer or employee or prospective public officer or employee.

+ hear or investigate a complaint, charge, or grievance by or against a public officer or employee.

+ plan, conduct, or hear reports concerning investigations or alleged criminal conduct."

So the motion to go into closed session was improper on its face;

(2) Assuming that the actual purpose was to "consider the qualifications, competence, performance, condition of appointment of a public officer or employee or prospective public officer or employee," and that it concerned the possible hiring by the Town of a police officer, the closed session was improper because it usurps the statutory powers and duties of the town manager under NCGS 160A-148. I have mentioned this before here and here.

I reminded the commissioners last night that they attended a special workshop August 17 2010 at 11:00 a,m. at Town Hall for the purpose "to learn the difference between Council/Manager and Council/Mayor forms of government...." The explanation was provided by Mr. Hartwell Wright, human resources consultant with the North Carolina League of Municipalities, accompanied by Ms. Lisa Kinsey, NCLM Member Services and Marketing Representative.

According to my notes from that session, Mr. Wright made it quite clear that in a council-manager government, the manager hires, fires and supervises all subordinate offices, including police, unless the town's charter is specifically amended. Otherwise, North Carolina General Statutes 160A-148 apply.

One of the commissioners said to me, "I'm looking at the Town Charter and it says we elect the constable." The same paragraph also stipulates that town officers (including the constable) must be a qualified voter in the town. The charter stipulates that municipal elections will be held every year on the first Monday in May, that commissioners have the power to collect taxes by levy and sale of property, and that the mayor has the power to cause all persons who fail to pay fines or imprisoned for violation of town ordinances to work it out on the streets. None of those provisions still apply.

The charter specifically cites chapter sixty-two (62) of the Code of North Carolina, vol. II as the source of the town's powers, rights, privileges and immunities, "as amended by subsequent acts of the general assembly."

That refers to The Code of North Carolina, Enacted March 2, 1883. I have a copy of chapter sixty-two of that Code, and provided a copy to the town manager some years ago to file with the charter. A reading of chapter sixty-two of the Code makes it apparent that very few of its provisions still apply to municipalities. The Code was long ago replaced by North Carolina General Statutes.

I'm reminded of a question raised forty-eight years ago by another old codger:

"Can't anybody here play this game?"
- Casey Stengel

Congressional Redistricting

Every ten years the United States goes through two related procedures following the federal census: (1) reapportionment, which is a process of reallocating seats in the House of Representatives to the states based on population and; (2) redistricting, which is the process whereby state governments redraw congressional district lines to create districts with more or less the same number of residents in each district.

The first of these processes is mathematical.

The second process is political. There is no mathematical approach that will reliably meet the criteria established by law and by federal courts.

What does the US Constitution say about congressional districts? Nada. Zilch. Representatives are allocated to states by state population and representatives must reside in the state they represent. No mention of districts. Then there is the requirement of the fourteenth amendment for equal protection of the laws. The Court has ruled this means "one person, one vote."

The constitution also provides there may not be more than one representative per thirty thousand population, but there must be at least one representative from each state.

The total number of representatives is set by law, not by the constitution. The last time the number was increased was in 1913, when each member represented about 200,000 voters. Following this year's reapportionment, each member will represent about 710,000 voters.

If you find it hard to get your representative's attention, this is certainly one reason.

When citizens of other western democracies learn about our redistricting system, they are puzzled. Most have some form of proportional representation, which requires no redistricting.

Should the Town of Oriental Disincorporate?

The recent retirement of Oriental's police chief, who was also the only paid member of the police department, has caused some to ask whether we need a police department. Can't we just let the county do it?

Good question.

If our taxpayers want to save money, there is an even more effective way to do it. Just cease to be an incorporated town.

What distinguishes an incorporated town from any other part of the county is the services it provides. Here is the list of services, some or all of which NCGS 136-41.2 requires municipalities to provide, along with the status in Oriental. The state's criteria is whether the town's budget appropriates funds for the service:

(i) police protection - not currently provided - some have proposed we just let the county do it;
(ii) fire protection - not currently funded by town - provided by Southwest Pamlico Volunteer Fire Department (no town appropriation);
(iii) solid waste collection or disposal - provided - town pays contractor. Some advocate changing to contracts by individuals instead of the town;
(iv) water distribution - provided - some have proposed selling our water plant to the county and letting the county distribute the water;
(v) sewage collection or disposal - not provided by town - the town sold its sewage treatment plant to Bay River Metropolitan Sewer District many years ago and no longer offers that service to its citizens;
(vi) street maintenance - some by town some by DOT - NCDOT already maintains some of the streets (e.g. White Farm Road, North St. and Broad Street) that would otherwise be our responsibility. Why not just let them do it all;
(vii) street construction or right-of-way acquisition - not provided - I have found no record in town minutes that the town ever purchased a street right of way or constructed a street (developers do that);
(viii) street lighting - provided - (many of the lights don't work);
(ix) zoning - provided, but controversial - the town's GMO is the source of great controversy. If we unincorporated, we would come under the county's land use regulations.

So, as it turns out, we do not completely provide or have abandoned a number of services normally provided by municipalities (six out of the nine listed services).

State law requires that municipalities levy an ad valorum tax of at least 5% per $100 of valuation in order to receive certain funds.

We could just lower everyone's taxes by 5% by unincorporating.

Not that there wouldn't be grumbling. Some would say we need a quicker police response than the county would provide. Some developers would chafe at the county's rules for waterfront property. Roads might deteriorate. Local ordinances would no longer apply. The town would no longer exist, so there would be no authority to sell liquor by the drink.

Operators of lodging would no longer have to collect and remit the occupancy tax. But something would have to be done with accumulated funds.

There would be no need for town hall and its staff. No public works department to fund.

So there would be complications and grumbling.

But look at the money we'd save.

Independence Day

The Continental Congress voted for independence on July 2, 1776.

On July 3, 1776, the British army evacuated Boston, leaving no British troops anywhere in the thirteen colonies of the Continental Congress.

The Continental Congress officially adopted the Declaration of Independence on July 4, 1776.

The official signing ceremony was not held until August, 1776.

So when British troops returned to the thirteen colonies, they were arguably invading an independent, sovereign nation.